Wall Street: Is the Economy Turning Japanese? And why investors should take advantage of the U.S. stock market while it’s still afloat ….

The Wall Street Journal states that America is now mimicking Japan’s post 1990 slump of “Ultra-loose monetary policy and low demand for credit, combined with high unemployment and consumer deleveraging … [which] could lead to a prolonged slump.”

The reality of an increasingly command-driven economy in America means that government policy is likely to become the key determinant of where investors should place their money. For example, the near-term prospects for the housing market in the U.S. will be strongly influenced by whether the federal government extends its first-time home-buyer tax credit when it expires in November. Like cash for clunkers with autos, the risk is that such a program is simply buying demand from the future.

This is why Wall Street should make the most of the rally in U.S. stocks while it lasts. The next bubble in asset markets will not be in the West but in emerging Asia, led by China.